Jeff Bezos, through his private investment firm Bezos Expeditions, is investing heavily in a burgeoning AI chipmaker, Tenstorrent, as part of a $693 million funding round. The round, which also attracted support from LG Electronics, Fidelity, Samsung Securities, and AFW Partners, signals increasing interest in challenging Nvidia’s dominance in the artificial intelligence chip market.

Tenstorrent intends to leverage the funding to advance its open-source AI software, grow its development workforce, and establish systems and cloud platforms tailored for AI developers. This approach positions the company as a competitor to Nvidia by offering more affordable and accessible AI solutions, particularly for smaller firms struggling to compete in a market dominated by Big Tech.

Nvidia, currently the second-most valuable company globally, generated $35.1 billion in revenue last quarter, with a significant portion coming from key customers like Alphabet, Meta, Microsoft, and Tesla. However, Tenstorrent’s strategy revolves around bypassing expensive components like high-bandwidth memory (HBM), which Nvidia heavily relies on. CEO Jim Keller emphasized that avoiding HBM allows Tenstorrent to lower costs and offer competitive solutions.

Open-source technology is gaining traction in the AI industry due to its cost-effectiveness. Companies like Meta and xAI, founded by Elon Musk, are embracing open-source models to democratize AI development and foster competition against proprietary systems.

By aligning with this trend, Tenstorrent aims to carve out a niche in the AI chip sector, backed by strategic investments from industry leaders and prominent figures like Bezos.